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Competition - legislative retrospective

State aid: Government Decision regarding a state aid scheme to support investments which promote regional development through job creation

On April 23, 2014, the Romanian Government has approved a Decision regarding a state aid scheme to support investments which promote regional development through job creation. According to this new state aid scheme, salary costs will be financed as unrefundable amounts, limited by the maximum admitted intensity levels of the state aid and at the maximum level of the medium gross salary. To be considered eligible costs, salary costs must be registered for a period of 2 (two) consecutive years, as a result of the job creation. The state aid afferent to eligible costs is granted if the following conditions are fulfilled:

jobs are directly created by an investment project;

jobs are created after the approval of the financing, but no later than 3 years after the completion of the investment.

The investments developed by undertakings under this scheme must cumulatively fulfill the following conditions:

they must be considered new investments, or new investments in favor of the development of new economic activities (this being the case of large undertakings in the Bucharest area);

they must lead to the creation, for each location of the investment, of at least 20 (twenty) jobs, with minimum 3 (three) jobs for disadvantaged workers;

they must be viable and they must determine the economic efficiency of the undertaking, according to the business plan.

Financing approvals based on this scheme may be issued until December 31, 2020 and payment of the de minimis aid will be performed during 2015-2025, considering the limitations of the annual budget allocated to the scheme. The state aid will be granted if it has a stimulating effect and contributes to the regional development.

State aid: Energy and Environmental State aid Guidelines

Adopted by the European Commission on April 9, 2014, the new guidelines aim at helping Member States to design state aid measures that contribute to reaching their 2020 climate targets and provide sustainable and secure energy, while ensuring that those measures are cost-effective for society and do not cause distortions of competition or a fragmentation of the Single Market. The guidelines will be in force until the end of 2020.

The guidelines extend the scope of the guidelines on aid for Environmental protection to the energy field, in particular to cover state aid to energy infrastructure projects, generation adequacy measures and energy intensive users. Also, the guidelines simplify the assessment criteria of several state aid measures already covered by the previous 2008 guidelines, such as cogeneration of heat and power.

The new guidelines aim to better integrate renewables into the internal electricity market in a gradual way, limiting support to what is truly necessary. Also, competitive bidding processes will increase cost effectiveness and limit distortions of competition. Small installations or technologies in an early stage of development can be exempted from participating in competitive bidding processes.

The version published on the European Commission website is informative and subject to change until its publication in the EU Official Journal. Starting July 1, 2014, the new guidelines will repeal the Guidelines on State aid for environmental protection.

From July 1, 2014, the Commission will assess new and pending notified State aid measures according to the criteria set out in the new guidelines.

Member States have one year from the publication of the guidelines in the EU Official Journal to bring existing aid schemes in line with the new guidelines, except for schemes for operating aid for renewable sources and cogeneration, which only need to be brought in line if they are prolonged or adapted.

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